Salaried class prefers PSBs for insurance

NEW DELHI: State-owned banking mechanism is the preferred choice for majority of salaried employees for insurance products given the reliability and security such institutions provide, a study has said.

Over 60 per cent of salaried employees prefer state-owned banking mechanism, while 20 per cent prefer private banks for the same purpose and remaining 20 per cent have shown their indifference to either of the two, industry body Assocham said in its study `Growth and Emergence of Public and Private Sector Banks in India: Customers and Investors Perceptions.

However, half of the salaried employees prefer private sector for mutual fund (MF) products, while only 20 per cent prefer public sector banks (PSBs) for the same, the study, which interviewed over 250 salaried employees, said.

About 20 per cent are indifferent to either of the two sectors for parking their funds in MFs, while 10 per cent do not avail this service, it added.

Over 40 per cent of the employees prefer PSBs for purposes of investment in bonds and securities as compared to 30 per cent who prefer the private banks, the study said.

"For bonds and securities, businessmen's preference is the other way round i.e. 80 per cent preferring PSBs. For Demat services, 40 per cent prefer private banks while 20 per cent are indifferent. For opening demand deposit accounts 40 per cent of businessmen prefer PSBs, while the same percentage prefer the private banks for demand deposit," Assocham President Venugopal Dhoot said.

For credit cards and ATMs, 60 per cent of the businessmen prefer PSBs, while for debit cards 40 per cent prefer private banks, 20 per cent prefer PSBs and 20 per cent being indifferent, the chamber said.